Should the State License Occupations At All?

An entertaining, all-but-unbelievable article about a Texas lawsuit being litigated by the inestimable Institute for Justice brings to mind one of my favorite passages from The Wealth of Nations. The article’s title suggests the infection in American jurisprudence that IJ is out to cure: “Should government rules have to make sense? Texas argues no in eyebrows case.” That’s right. The Texas state government is arguing that the rules governing who may thread eyebrows need to make no sense; they are valid even if senseless. Here’s the core of the article:

[L]awyers from the [Institute for Justice] went before the Texas Supreme Court on Thursday to argue in favor of a clear standard that would allow lower state courts to overturn particularly awful decisions by regulatory bodies and the Legislature.

The problem, they say, is that courts are so deferential to the other branches of government that even the most blatantly mindless and abusive regulations are upheld as legitimate exercises of government authority.

They picked a great case to make their point.

Ash Patel is a Houston entrepreneur who once planned to open a chain of beauty salons specializing in eyebrow threading, an ancient hair removal practice that employs taut threads to shape eyebrows. He had opened just one of the salons when he found that state regulators were requiring threaders to have cosmetology licenses. So he sued.

To get a license, you have to spend upward of $20,000 and spend a year taking 750 hours of instruction at cosmetology school, even though cosmetology schools aren’t required to teach eyebrow threading and the licensing exam doesn’t test eyebrow threading.

Let’s hope IJ prevails on Ash Patel’s behalf, and sets a precedent that allows conscientious judges to begin defending the right to earn a living from the interference of legislatures protecting special interest groups from competition.

As wholeheartedly as I support what IJ is doing, however, I think we should ask a more fundamental question: should governments license occupations at all?

In Free Our Markets I make the case that regulation by market forces would work much better than government regulation, including government licensing. And I recently helped make this LearnLiberty video that presents one aspect of the case.

As important as the economic arguments against licensing are, the philosophical, ethical argument is more important and compelling. And no one has expressed that argument better than Adam Smith, in this ringing passage:

The property which every man has in his own labour, as it is the original foundation of all other property, so it is the most sacred and inviolable. The patrimony of a poor man lies in the strength and dexterity of his hands; and to hinder him from employing this strength and dexterity in what manner he thinks proper without injury to his neighbor, is a plain violation of this most sacred property. It is a manifest encroachment upon the just liberty both of the workman, and of those who might be disposed to employ him. As it hinders the one from working at what he thinks proper, so it hinders the others from employing whom they think proper. (The Wealth of Nations, Book I, Chapter X, paragraph 67)

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